Syntec offers free technology license

By Kris Bevill

Web exclusive posted June 27, 2008 at 1:43 p.m. CST

When gas stations hold a grand opening they tend to offer gas at a reduced rate or free snack food with any purchase. It's simple marketing - create a celebratory atmosphere and bring people to the business to see what it has to offer. Keeping that in mind, what does a thermochemical technology company offer during its grand opening? Free technology, of course.

That was one of the reasons behind Vancouver-based Syntec Biofuels Inc.'s recent announcement that the company is offering free licensing of its thermochemical conversion technology to interested parties. The license is valued at $250,000, according to Syntec.

Michael Jackson, president and chairman of Syntec, said the deal is the company's first approach to let people know they are ready to distribute their technology. Recent flooding in the U.S. Midwest and high corn prices further spurred Jackson to create the no-cost offer. "My thinking was, if we could help them (ethanol producers) in some way - a license is a small part – but if it could give them the idea to put up a thermochemical facility in conjunction with corn ethanol…it would increase their revenue and decrease the cost," he said.

Syntec began working on its process in 2001. The company has developed advanced catalysts to be used in a thermochemical gasification process to produce ethanol from a variety of biomass feedstocks, including corn stover. "There are only two companies in North America who are at the level we are at and that is (Colorado based) Range Fuels and ourselves," Jackson said, adding that he believes Syntec is the first company to begin licensing.

The technology license being offered by Syntec is for use in a 12 MMgy facility. Jackson said that by processing 300 dry tons of feedstock per day and producing fuel at an average cost of $2.35 per gallon, the small-scale facility could generate over $27 million per year.

Companies using Syntec's technology will pay a royalty license of 7.5 cents per gallon of liquid produced. A 12 MMgy plant, if operating at capacity, will pay Syntec $900,000 per year in royalties.

Since Syntec's free license offer became public Jackson has had several calls from people interested in learning more about the process. Although ethanol producers might be well-aware that cellulosic ethanol is the next step, they still lack widespread knowledge about the variety of techniques able to produce the fuel, Jackson said.

Lack of common knowledge about its process has not stopped the company from marketing its license around the world. "Right now we're dealing in Japan – we've got quite a number of countries we're dealing with there," Jackson said, adding that they're also in talks with companies in China, Italy, Egypt, India, Brazil and North America. "The world is big and that's why I feel there is no competition," he said. "Everybody's technology is good. The people who are going to win the World Series [will be] whoever's got the lowest cost and the simplest process. We just want to be in the game."